Life Insurance is divided into two main categories: whole life policies and term life policies. Today, our discussion turns to understanding the in’s and out’s of term life insurance.
Term life insurance, sometimes simply referred to as “term insurance”, is insurance that you purchase for a set period of time. One of the goals of having term insurance in place is to provide for your family’s needs in the event of your death. However, eventually, as you proceed through life and continue to succeed in your chosen career path, you will eventually be able to earn and save enough to provide for them yourself, at which point you will no longer need the insurance.
Term life insurance rates vary, but in general, term insurance is less expensive to purchase than whole life insurance. Term life insurance gives you the coverage that you need for the length of time that you need it. The beauty of many term life policies is that you are not required to purchase coverage that you don’t need. Term life insurance can be purchased for one, ten, twenty, or even thirty years. If you were to pass away during that time for which you are insured, your beneficiaries would receive a payout. This payout could provide for their general living expenses, pay for large upcoming costs such as college, or cover your final end-of-life expenses.
Term life insurance comes in two forms: annual renewable term, and level premium term.
Annual renewable term, like the name implies, may be purchased for one year at a time and must be renewed annually. Initially, an annual renewable term policy is inexpensive, but the cost of the policy goes up as you age.
Level premium term insurance can be purchased for longer periods of time, and the cost of the insurance will remain the same throughout the entire term you are insured. This lets an insured person lock in their premium rate for the entire length of the coverage.
If you have questions about what type of life insurance is best for your situation, contact us! We are thrilled to have been able to serve the residents of the Boynton Beach area for over sixty years, and would be happy to speak with you regarding all your insurance needs.